T he 4S Web-Marketing Mix model Efthymios Constantinides

Electronic Commerce Research and Applications 1 (2002) 57–76
www.elsevier.com / locate / ecra
The 4S Web-Marketing Mix model
Efthymios Constantinides
Department of Technology and Management, University of Twente, Enschede, The Netherlands
Accepted 10 April 2002
Abstract
This paper reviews the criticism on the 4Ps Marketing Mix framework, the most popular tool of traditional marketing
management, and categorizes the main objections of using the model as the foundation of physical marketing. It argues that
applying the traditional approach, based on the 4Ps paradigm, is also a poor choice in the case of virtual marketing and
identifies two main limitations of the framework in online environments: the drastically diminished role of the Ps and the
lack of any strategic elements in the model. Next to identifying the critical factors of the Web marketing, the paper argues
that the basis for successful E-Commerce is the full integration of the virtual activities into the company’s physical strategy,
marketing plan and organisational processes. The four S elements of the Web-Marketing Mix framework present a sound and
functional conceptual basis for designing, developing and commercialising Business-to-Consumer online projects. The model
was originally developed for educational purposes and has been tested and refined by means of field projects; two of them
are presented as case studies in the paper.
 2002 Elsevier Science B.V. All rights reserved.
Keywords: E-Commerce strategy; E-Commerce marketing; Web Marketing Mix; 4S model
1. E-Commerce landscape in transition
A recent report [1] predicts a Web population of
over the 1bln users in 2005, while many indications
point to an upcoming fast growth of E-Commerce
revenues and a growing consumer willingness to
engage in online transactions [2,3].
For the 210 Internet companies (a large percentage
of them publicly traded) that shut their virtual doors
in the year 2000 and the one dot.com that daily goes
out of business since the beginning of 2001 [4,5] this
kind of news sound a bit beside the point. In the
Internet after-the-gold-rush period many of the first
E-mail address: [email protected] (E. Constantinides).
wave Web gold seekers struggle for survival by
downsizing, streamlining processes and cutting costs,
while academics, consultants, analysts, managers and
journalists try to figure out what went wrong and
ascertain the lessons to be learned from the present
Web dejection. Learning is particularly important for
the survivals of the crisis and the incumbents, who
will be the next to join the virtual marketplace [6].
Analysing the causes of the Internet crisis Christensen [7] argues that the major factors for E-Commerce failures are the lack of awareness by many of
the Internet players as to the basis of their industry
competition and the failure of several businesses to
exploit new technologies in a sustainable manner [8].
Lack of strategy and clear objectives [9], old-fashion
product orientation, limited understanding of cus-
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PII: S1567-4223( 02 )00006-6
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E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
tomer needs and poor commercial competencies are
also frequently mentioned as issues having contributed to the continuing dot.com demise. An important, though less visible and often overlooked
source of problems for the Internet players is the
weakness of the traditional marketing paradigm,
embodied in the well-known Marketing Mix framework proposed by Borden [10] and popularised as
the 4Ps (Product, Price, Place, Promotion) by
McCarthy [11], to provide an adequate platform for
E-Commerce marketing management. The assumption that the 4Ps framework is widely used by
E-Marketers as the underpinning of their marketing
planning is based on the high degree of acceptance
of the Marketing Mix by marketing practitioners as
¨
the universal marketing paradigm. Gronroos
[12, p.
323] argues that the 4Ps framework has won an
overwhelming acceptance among marketing practitioners, noticing that ‘‘ . . . Marketing in practice
has, to a large extent, been turned into managing this
toolbox . . . ’’, a point shared by Goldsmith [13, p.
178] who argues that the ‘‘ . . . time-honoured concept of the 4Ps—the Marketing Mix . . . ’’ is the heart
of the contemporary marketing management.
The shortcomings of the 4Ps marketing mix
framework, as the pillar of the traditional marketing
management have frequently become the target of
intense criticism. Despite the fact that hardly any
marketing textbook avoids mentioning the 4Ps, more
than 75% of marketing academics are not satisfied
with it as a pedagogic tool [14, p. 9]. The 4Ps
framework is also criticised by researchers who
identify several deficiencies in dealing with the
marketing realities of today. A number of critics
even go as far as rejecting the 4Ps altogether,
proposing alternative frameworks. Ohma [15] reviews the 4Ps from the Strategic Management perspective concluding that no strategic elements are to
be found in the model. He proposes that three Cs
shape the marketing strategy: Customers, Competitors and Corporation. Bennet [16] suggests that
the 4Ps are focused on internal variables and therefore form an incomplete basis for marketing. He
suggests five Vs (Value, Viability, Variety, Volume and
Virtue) as the criteria of customer disposition, while
Lauterborn [17] finds the model too product oriented
arguing that the customer must be placed in the
centre of the marketing planning. One of the most
outspoken critics of the 4Ps from the Relationship
¨
Marketing angle is Gronroos
[12] who is identifying
several reasons against using the 4Ps as a planning
tool for marketing. He argues that the model has
become a management straightjacket victimising not
only the marketing theory but also the customer.
Godin [18] considers also the Marketing Mix as an
obsolete product of the mass marketing, unable to
promote the personalisation required by modern
marketing.
2. The need for new E-commerce conceptual
frameworks
Essential differences between the virtual and
physical commerce have prompted calls for a reevaluation of the existing marketing principles, when
dealing with E-Commerce. According to Hoffman
and Novak [19] ‘‘ . . . marketers should focus on
playing an active role in the construction of new
organic paradigms for facilitating commerce in the
emerging electronic society underlying the Web,
rather than infiltrating the existing primitive mechanical structures’’. Such suggestions, added to the
objections raised on the role of the Marketing Mix as
the basis of the physical Marketing Management,
have prompted several academics and practitioners to
question the potential role of the 4P model for the
virtual Marketing. These questions are frequently
debated in E-Commerce forums and in a growing
number of marketing management textbooks, academic papers and press articles. Two main streams
are visible in this literature:
(a) Most writers addressing primarily practitioners’
audiences, are usually focussed on outlining and
optimising the management processes by identifying best E-Commerce practices [20–25] or
advising on Web design tips [26]. A basically
descriptive and process-focused methodology is
followed by Chaffey et al. [27] outlining the
E-Commerce marketing planning as a process
based on eight decision points. Seybold [28] had
earlier proposed a similar approach while Oliver
[29] identifies seven E-Commerce laws as the
basic parameters of the E-Commerce strategy.
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
(b) Contributions of academics and practitioners
focused on E-Commerce marketing have yielded
a growing list of articles and books. Some
writers focus their attention on value creation
[30,31] while others distillate on the differences
and similarities between traditional commercial
practices and Web business models [32] or
processes [33]. Angehrn [34] proposes a
strategic model of a merely descriptive and
explanatory nature, suitable for diagnosing the
maturity and strategies of E-Commerce sectors
as well as structuring and detecting opportunities
in individual companies. Another modelling
approach is suggested by Huizingh [35] who
delimits the online commerce issues by the
Strategic Internet Applications Model (SIAM),
the Customer Interaction Cycle (CIC) and the
Accessibility, Design, Offer and Fulfilment
(ADOF) model. Lawrence et al. [36, p. 79]
propose the Marketing Mix as a proper basis of
E-Commerce marketing activities.
Despite the growing attention on strategic modelling there are still, according to Chaffey et al. [27, p.
152], ‘‘ . . . a few appraisals of methods of implementing an Internet marketing plan from an academic viewpoint’’. Writers attempting to develop such a
viewpoint often choose for a conservative approach
by resorting on established Marketing Management
concepts and suggesting ways to convert existing
frameworks into usable concepts for the online
Marketing. This approach often emphasises the role
of the Marketing Mix 4Ps model as the proper basis
of the Marketing Management planning in virtual
environments. A number of writers suggest that the
4P model could constitute the conceptual platform
for E-Commerce marketing planning virtually unchanged [36,37]. Others suggest a few transformations in order to adapt the model to the digital
marketplace [38], while O’Connor and Galvin [39]
are diagnosing Marketing in a condition of a mid-life
crisis and argue that new technologies can improve
and optimise the 4Ps-based management process.
The obvious explanation for the loyalty of many
writers to the 4Ps model is its undisputed record,
intrinsic simplicity and comprehensiveness, making
it a very popular tool among practising marketers as
explained earlier.
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3. The traditional Marketing Mix paradigm is
incompatible with E-Commerce
The Internet, as commercial environment, embraces some of the most substantial developments
that took place in the marketing landscape of the last
40 years. The virtual marketplace epitomises the
evolution process from the mass markets of the
1960s to the increasingly segmented, niche-dominated or even mass-customised, highly interactive
and global markets of today. The effect of the new
setting is that the focus of marketers has shifted
towards satisfying individual and personalised rather
than collective needs while placing much more
emphasis on customer retention, customer service
and relationship marketing. Such changes follow
closely the shifting behaviour patterns of new generations of individualistic, better informed, wired and
wealthier consumers. Consumers increasingly demanding more control over the marketing process
[40], value the personalised approach and prefer
products or services that can be promptly adapted to
their constantly changing needs.
Having analysed the criticism on the role of the
Marketing Mix as the marketing paradigm in the
physical world one could argue that this criticism is
reconfirmed when attempting to apply the 4Ps in the
virtual environment. One obvious weakness is the
fact that the model does not explicitly include any
interactive elements [12, p. 324], while interactivity
is the basis of the Internet Marketing. It can be
argued furthermore that two more important points
are indicating the limitations of the 4Ps in the virtual
marketing.
(1) Applying the Marketing Mix model in traditional markets implies that the four P parameters of
the model delimit four distinct, well-defined and
independent management processes. Despite the
consistent effort by many physical businesses to deal
with the 4Ps in an integrated manner, the drafting but
mainly the implementation of the P policies remains
largely the task of various departments and persons
within the organisation. Even more significant
though is the fact that the physical customer is
typically experiencing the individual effects of each
of the 4Ps in diverse occasions, times and places,
even in cases that companies take great pains to fully
integrate their marketing activities internally.
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
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Unlike the physical world, in the virtual marketplace the four elements of the mix are not
detached from each other. They are heavily
interrelated and for all intents and purposes
jointly experienced by the online customer, being
merely parts of the content of the Company–
Customer interface, better known as the Web Site.
This suggestion has important implications for the
customer’s buying behaviour. While the traditional
buyer behaviour model [41, p. 161] considers the 4Ps
as the controllable factors likely to influence the
conventional consumer’s buying decisions, it is the
Web Experience—the Web experience is the consumer’s impression about the online company [42]—
the factor under the marketer’s direct control likely
to influence the buying behaviour of the online
consumer. From the customer’s perspective the Web
site depicts the very aspects likely to prompt his
reaction to the online offering, the 4Ps being merely
a part of the site based Web Experience and as such
simultaneously experienced by the customer [48].
3.1. Product
The Web site is the prime online product and
brand of the online organisation. The customer
should become aware, develop interest and be persuaded to search for the site / product before going on
looking into the company’s detailed online offering.
3.2. Price
The majority of commercial sites function as price
lists for the company’s physical product assortment.
Besides that, the Web site is perceived by the online
prospect and customer as a cost element (due to
connectivity cost,transaction costs, time and opportunity cost). Although this costs will be in most cases
lower than the cost of performing these activities
physically, the customer will compare these with the
cost of finding other online competitors and doing
business with them.
3.3. Promotion
The Web site is the promotional medium as well
as the promotional content. The communicational
and emotional impact of the Web site is an important
part of the Web experience and a major factor in
attracting and retaining online customers.
3.4. Place
For the majority of E-Commerce cases involving
any form of online interaction–transaction, the Web
site is the counter, helpdesk and sales outlet where
the actual commercial or non-commercial transaction
takes place. Moreover for products delivered in
digital form (music, information, software and online
services) the site fulfills even the task of the physical
distributor by allowing the product delivery online.
The above analysis suggests that attempting to
approach the 4Ps in isolation in the Web environment
is not a sound strategy, since online customers by
and large experience them in a simultaneous and
direct manner, as elements of the Web site-based
customer experience. For Internet customers this
experience will include many other elements like
findability of the site, ease of navigation, prompt
replies to e-mails and easy to use shopping and
payment procedures and will be the criterion for the
customer to come back to the site or not.
(2) The 4Ps Marketing Mix paradigm has been
developed as an operational rather than a strategic
tool and conventional marketers have always treated
it as such. In the physical world the strategic
management aspects are in effect separated from the
commercial operations due to the very nature of the
strategic management itself. Most marketers regard
therefore the corporate strategy as an external variable over-imposed to their marketing mix. Applying
the 4Ps Marketing Mix model as the sole planning
platform for E-Commerce operations could mean
that the strategic aspects would remain underexposed
or disregarded altogether. An option for defining the
strategy of an online organisation is to follow the
conventional strategic management procedure
[43,44] but two hitches make such an option often
unattractive for Web marketers:
• The conventional strategic process is by nature
time consuming and time in the Web is often in
short supply.
• The volatile, fast changing and constantly
evolving nature of the Internet can rapidly
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
outdate conventionally developed strategies
making them abruptly obsolete [29].
The customary strategic management processes is
in other words time consuming, inflexible and in
effect inappropriate for the dynamic and unpredictable online markets. The shortcomings of the classic
strategic approach can explain the obvious aversion
for strategic planning by the majority of dot.coms
[45]. Most brick-and-mortars entering the Web on
the other hand would presumably find it more
convenient to apply their existing strategic model to
their Web operations rather than delineating a new
E-Commerce strategy. In some cases such a policy is
sensible, in other cases not. British Airways (BA)
learned the hard way that competing online on the
basis of the existing strategic model with EasyJet.com and other value-oriented airlines was impossible. After the initial poor results of the new BA
Web site as a ticket counter the company drafted a
new strategic approach by launching the low-cost
offshoot airline Go to compete in the online lowbudget market.
A way of solving the Web strategy problem is by
integrating the online strategic planning into the
operational marketing planning, this way building
much more flexibility into the system. This would
mean introducing an E-Commerce ‘micro-strategy’
that while in line with the corporate physical strategy
would be flexible and easily adaptable to fast changing online conditions.
4. The Web-Marketing Mix (WMM) model
The Web-Marketing Mix model identifies the
online marketing critical elements and addresses the
main E-Commerce strategic, operational and organisational issues in an integrated and manageable
manner. The WMM is an appropriate basis for the
Web Strategic and Marketing planning, especially
intended for click-and-mortars operating in the in the
Business-to-Consumer segment. The tool is designed
primarily for conventional, physical corporations
planning to establish an Internet presence. The model
can be also useful to pure-plays or existing online
organisations in re-evaluating their E-Commerce
presence, provided that such organisations already
61
have or are considering having a physical presence
next to the virtual one.
The Web Marketing Mix approaches the marketing
planning process in an integral manner, on different
levels:
On strategic level the model identifies the main
strategic issues to be addressed in order to build up a
flexible, value adding and potentially successful ECommerce organisation. The model emphasises the
fact that online activities should be assigned their
own strategic objectives in line with the corporate
ones. Next to that it recommends the highest possible
assimilation of the online venture into the physical
corporate commercial strategy in order to capitalise
on the existing organisation’s strengths and competitive advantages.
On operational level the WMM proposes a method for drafting realistic and consistent Web marketing plans. The prime objective of the operational
planning is the development of a market-oriented,
effective, flexible and unique online presence.
On organisational level the WMM addresses the
issue of building up the proper organisational, human
and knowledge infrastructure necessary for a smooth
online operation. The model identifies areas where a
high degree of integration of the virtual business into
the corporate infrastructure is necessary in order to
maximise the synergies between the virtual and
physical business and improve the overall organisational efficiency.
Next to these three main focus areas the WMM
denotes the need for further improving the competitiveness of the online organisation by seeking synergies with ‘complementors’ i.e., third parties or
industries. These complementary firms have been
recommended by Shapiro and Varian [46] as the
sixth force to be added to Porter’s five competitive
forces model in order to fully understand the competitive strength and competitive position of firms
operating in information markets.
Finally the model identifies the main technological
and administrative issues that will underpin E-Commerce activities.
The above-mentioned issues describe the successive steps of the Web commercial planning methodology and are classified in four groups. Each
group is labelled by a word beginning with the letter
S namely the Scope, Site, Synergy and System
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
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(Exhibit 1). The content of each S-group is based on
the previous steps but feedback during the planning
process is necessary for fine-tuning of each step. The
final result—the Web Strategic and Marketing Plan—
will become the basis of the Internet project, the
groundwork of a process including several more
stages: the development of the technical and organisational infrastructure, the technical implementation,
the testing of processes and the commercialisation of
the Web site.
Finally, it should be mentioned that the fast
changing character of the Web makes it imperative
that the planing procedure is frequently repeated—
the frequency depending on the branch, the market
developments and the competitive reactions—in
order to maintain the competitive advantage of the
online organisation overtime.
5. Description of the Web-Marketing Mix model
The Web-Marketing Mix identifies four online
marketing strategic, operational, organisational and
technical critical factors: the Scope (strategic issues),
the Site (operational issues), the Synergy (integration
into the physical processes) and the System (technical issues) (Table 1).
5.1. Scope
This content of this element is of primarily
strategic character and outlines the decisions to be
made on four areas:
(a) the strategic and operational objectives of the
online venture;
(b) the market definition including measuring the
market potential and the identification / classification of the potential competitors, visitors and
customers of the site;
(c) the degree of readiness of the organisation for
E-Commerce;
(d) the strategic role of E-Commerce for the organisation.
More specifically:
5.1.1. Objectives
The online activities must pursue their own,
clearly defined strategic objectives, in line with the
corporate mission and strategic goals. This way the
online operation will be able to generate additional
value and assist the physical organisation to attain
the corporate objectives.
Online strategic objectives do not essentially differ
from the traditional ones and are subject to the same
quality criteria. Such objectives can be: enhancing
profitability, improving the company image, raising
revenue, reducing operational costs, expanding the
customer base, increasing the customer retention or
augmenting the product and brand awareness among
new groups. The Web objectives will form the basis
for outlining the operational trajectory of the ECommerce venture, based on different tactics or
combinations of tactics. Increasing revenues, for
example, could be realised by online promoting the
company brands and company products and expanding the brand awareness while at the same time
launching promotional activities in order to attract
new and existing customers to the physical sales
outlets. The same objective could also be reached by
a retention-oriented site aiming at improving customer service and customer relations or even by
establishing an online sales outlet.
5.1.2. Market analysis
It is of vital importance for Web companies to
identify their market domain, market potential, the
profiles of potential customers and the online strategies of competitors. The global character of the
Internet, the fast growth of online businesses and
users’ numbers, the changing demographics of the
online population and the limited familiarity of many
mainstream managers with E-Commerce makes the
market analysis a challenging task. The analysis,
however, will yield a clear picture as to the market
size, customer profiles, competitive situation and
future trends. It will also reveal new market opportunities, assist the budgeting process and provide
creative ideas as basis for the online marketing
activities.
Identifying the potential online customer and his
or her needs is the task often posing most difficulties.
This due to the fact that the potential online buyer
can be quite a different individual from the physical
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
Table 1
The Web-Marketing Mix
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E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
customer who traditionally buys the company’s
products and services. Web clients can be persons
with different buying motives, cultural backgrounds,
needs, demographic, technographic or lifestyle profiles from the conventional customers. Moreover,
online clients can be located outside the geographical
areas where the company normally operates, a fact
by itself raising serious logistic, legal and administrative problems.
In case that market research data is not available, a
number of initial, basic assumptions must be made as
to the most likely profiles, needs, motives, attitudes
and demographics of the potential Web customers.
These assumptions will help the online marketer to
identify potential market segments and decide the
initial site positioning, unique selling proposition,
style, design, structure, product assortment policies
and pricing strategy. Assumptions made in this initial
stage should be constantly refined using online as
well as physically collected customer and market
information.
5.1.3. Internal analysis
Adoption of new technologies can have sustaining
or disruptive effects on organisations, depending on
the firm’s resources, processes and values [8]. The
internal analysis should be focused on these three
factors in order to identify the degree of company
readiness to assimilate E-Commerce and assess the
possible effects of it on the organisational value
chain [47]. Based on the internal analysis the management will further refine the Web strategic objectives and will identify the proper Strategic Role (see
Section 5.1.4) of the online activity. The management will obtain a clear insight into to the real costs
of the operation not only in financial terms but also
in terms of disruption of the established physical
processes and infrastructures. It is likely that in some
cases the outcome of the internal assessment will be
a No-Go decision, due for example to the high
degree of organisational disruption, low added value
or extremely high expenditure against low expected
benefits. In such cases the management should
consider alternative options, one of the possible
alternatives being separating the Web operations
from the existing corporate body. While such a
strategy seems often to be an attractive solution, such
options must be always treated with caution [9].
5.1.4. Strategic role
The strategic role describes the tasks assigned to
the online activity and will be reflected on the firm’s
online model.
Web marketers can choose between a number of
generic strategic roles, the most common being the
informational, educational, service oriented, promotional, relational and transactional ones. The actual
strategic role—the business model—is frequently
based on a combination of more of these generic
types.
An example: the strategic role assigned to the Web
presence of an insurance company can be an informational one (an online brochure), i.e., simply
informing the site visitors about the company and
assisting potential customers to find information
about its products and dealer network. The role,
however, will be a transactional one (an online
insurance agent) if the company chooses to sell its
products online.
The strategic role as defined here, will have
important consequences for the site identity, positioning, style and atmosphere, content, structure,
functionality, organisational / technical infrastructure
and any other element of the Web Experience. The
objective of the E-Marketer must be to differentiate
the site and create a Web Unique Selling Proposition
appealing to the target group(s), conveying customer
value and consolidating competitive advantages.
Such a proposition must be:
• proprietary, hard to be imitated by competitors;
• able to produce win–win situations with the
existing business partners;
• flexible enough to be easily adapted to changing
market conditions and external developments.
5.2. Site
The Web Site is the company–customer interface,
the prime source of customer experience and therefore the most important communication element of
E-Commerce.
As explained earlier, the Web site is the virtual
product display, promotional material, price
catalogue and sales / distribution point. The Web site
is therefore the functional platform of communica-
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
tion, interaction and transaction with the Web customer.
The prime mission of the Web Site is to attract
traffic, establish contact with the online target markets and brand the online organisation. Next to this
‘generic’ mission the Web site can be assigned a mix
of commercial objectives—but often also non-commercial ones like personnel recruitment, shareholders
info, etc.—and tasks, depending on the previously
defined strategic role. Some of the common site
objectives and tasks are:
• communicating and promoting the E-business
image, labels and products / services;
• providing company information to customers
and stakeholders;
• effectively communicating the firm physical or
virtual promotional activities;
• providing customer service and helpdesk functionality in order to enhance the customer
loyalty and retention;
• providing sales leads and customer / market data;
• allowing customers to communicate and interact
with the company as well as creating online
content;
• allowing direct sales and facilitating online
payments (transactional sites).
A number of Internet-specific aspects like domain
names, site and transaction security as well as
privacy policies are critical parameters of the Web
site and the Web experience. Online privacy and
protection of personal data are often overlooked by
online businesses despite the fact that millions of
consumers seem to be very concerned about the way
their personal information is used. According to
Forrester Research this lack of confidence represented as much as $12.4 bln in lost sales in the year
2000 [45].
It is obvious that the Web site is expected to fulfill
a variety of roles not common to any single conventional marketing instrument. Assigning roles to a
Web site while maintaining its functionality and user
friendliness is a delicate process depending not only
on the available funds and technological options but
foremost on good knowledge on the potential customer’s motives, needs, expectations and behaviour.
Special attention must be finally placed to aspects
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like the site findability and site speed, keeping in
mind the average user’s skills, available bandwidth
and other technical limitations.
5.3. Synergy
For the purpose of this analysis we define term
Synergy as the integrating processes necessary for
realising the virtual organisation’s objectives. Such
synergies can develop between the virtual and the
physical organisation as well as between the virtual
organisation and third parties.
The above definition implies that the following
analysis is appropriate for organisations with both
physical and virtual presence, i.e., brick-and-mortars
engaging in E-Commerce or Internet companies
willing to establish and develop some type of
physical commercial and organisational presence
next to the virtual one.
This Synergy factor embraces a wide range of
issues divided into three categories: The Front
Office, the Back Office and the Third Parties.
5.3.1. The Front Office
The Web industry usually refers to the front office
as the web site itself. In the context of the WebMarketing Mix model the Front Office refers to the
conventional corporate communication and distribution strategies. The Front Office element underlines
the need to examine and identify ways that would
facilitate the full integration of the Web operation
into the company’s communication plan, corporate
style as well as the existing physical retail channels.
Incumbents intending to establish an online presence must analyse the extent, magnitude and financial cost of the adjustments necessary in order to
accommodate and integrate the communication of
the virtual activities into their current promotional
plan. The effort must be focused on utilising existing
communication strategies, brands, tools and channels
in order to promote and support the Web operation
during the introduction stage. The objective of this
communication is to inform existing as well as
potential customers about the future Web activities
and outline the advantages of doing business online.
The need for integration and synergy between the
online and the physical communication plan is
obvious. Utilising existing promotional activities and
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E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
capitalising on embedded customer goodwill is economical, less time consuming and more effective than
launching new promotional campaigns with the
purpose of establishing new commercial concepts
and brand identities. Furthermore existing customers
are more sensitive than non-customers are to company communication and most probably willing to
make use of the online functionality.
The synergy of the online operation with the
Front-Office activities will obviously not be limited
to the introduction stage of the E-Commerce project.
One should expect that in the long run in the
majority of cases the dependence of the virtual
business on the physical business will be gradually
reduced while the dependence of the physical business on the web will most likely increase. A mature
online operation will be able to support the corporate
marketing strategy as a low-cost source of customer
and market data as well as a retail outlet and an
efficient communication instrument.
In addition to the promotional integration the web
operation must be able to operate along the existing
distribution framework adding value to it. Traditional
distribution channels are often resisting on line sales
fearful of profit cannibalisation. Empirical evidence,
however, reveals examples of successful integration
of virtual business with existing distribution channels
without serious disruption of existing business [7]. A
good example (but certainly not the only one) are
mail-order or telephone sales firms who have been
able to fully utilise existing logistics infrastructures
since the similarities between their conventional and
virtual business models are obvious [6]. The task of
the Web marketer is to find ways to minimise the
channel conflicts by recognising possible mutual
benefits and translating them into win–win situations
for all parties.
5.3.2. The Back Office
This Back Office synergy embraces a wide set of
issues, including:
1. the integration of E-Commerce physical support
activities (customer service, order processing,
fulfilment and reverse logistics) into the existing
organisational processes;
2. the legacy integration;
3. integration of the online operation into the
company’s value system [43].
Making existing organisational infrastructures
available to the online operation is a more sensible
option than crating new ones. Next to the obvious
cost aspects, the online organisation is likely to
benefit from economies of scale and learning effects.
Whenever changes in existing infrastructures are
necessary, in order to meet the usually higher quality
standards of the Web operations, such changes will
be beneficial for the organisation as a whole, physical and virtual. Therefore, E-Commerce can become
a catalyst of organisational re-engineering and
change. In more detail:
1. Organisational integration. Integration into the
existing support operations is necessary for the
online firm in order to be able to provide the
fulfilment and Back Office support expected by
Web customers. Back Office efficiency is essential from the very moment the Web operation
goes live and customer data, queries and online
orders begin streaming in. With competitors
only one click away, customers disappointed or
frustrated by poor fulfilment and service need to
put very little effort to bring their business
elsewhere.
Online service, the Achilles heel of many
Internet businesses, is an extensive domain
where a wide variety of problems and situations
can occur. Poor Web service practices range
from simple failure to react or overdue reaction
to customer e-mails to more complex problems
like frustrating ordering and return procedures,
lack of order tracking, inefficient helpdesk
support, poor after-sales service. Failure to meet
delivery deadlines, non-delivered goods, incorrect or inferior quality products and erroneous
invoicing are also common fulfilment flaws.
The Web manager should evaluate the physical Value Chain [9] and its capacity to facilitate
the Web Back Office needs. Such an evaluation,
utilising the previously conducted Scope analysis (see Section 5.3.3), will reveal possible
weaknesses and outline the changes necessary
in order to upgrade the existing Back Office to
the necessary quality level. Constant monitor-
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
ing—requiring efficient auditing mechanisms,
benchmarking and close monitoring of customer
behaviour—must detect flaws and initiate corrective action.
2. Legacy integration. Integration of online activities into the existing Information Infrastructure including Management Information Systems (MIS), Efficient Resource Planning (ERP)
Systems, databases and data warehouses is vital
for the management and administration of ECommerce activities. Efficient utilisation of the
company IT legacy will result in cost advantages, improved decision-making and more efficient information management.
3. Integration with the company Value System. In
cases of transactional sites the Back Office
integration process should expand beyond the
company boundaries and include all external
participants in the firm value system: intermediaries, suppliers of raw materials and any
other parties directly or indirectly affecting the
production, distribution and logistic processes.
Online ordering, typical for transactional sites,
requires Efficient Consumer Response (ECR)
strategies: synchronised production, JIT and
efficient inventory management. Such tactics
demand a high degree of efficiency within the
Value System. Moreover Intranet and Extranet
replacing expensive proprietary EDI and EFT
systems as functional platforms will allow cost
reductions and higher efficiency.
search engine strategies can result in substantial
increase of the Web site exposure, attracting a
substantial percentage of Web users who use
such tools when searching for online products,
information and services. The search engine
strategy is based on a combination of active
registration and the effective use of techniques
and programming tools (for example meta-tags)
increasing the chances of the Web site to be
listed in high positions in search queries. A
sound search engine strategy provides finally for
mechanisms allowing the frequent evaluation of
the site findability and if necessary fast corrective action.
• Affiliate networks. Affiliate networking is a
popular method of online promotion, introduced
and popularised by amazon.com. On line organisations create affiliate networks by recruiting other sites willing to place a banner or a link
on their pages in exchange for a commission
based on click-through or more commonly on
revenue generated by click-through customers.
Such networks can substantially strengthen
the market exposure of online organisations in a
cost-effective manner making them an attractive
option to many new online organisations. Next
to creating their own affiliate networks online
organisations can become members of other
affiliate schemes in order to generate additional
incomes.
Management issues and the possible association of the online company with questionable
partners participating in the network are the
main points of concern around affiliate marketing.
• Online advertising. This type of promotion is
based on placing interactive advertisements
(banners, buttons or hyperlinks) at high traffic
sites or sites likely to attract potential customers
at a cost usually based on the popularity of the
advertising site.
Industry observers have often questioned the
effectiveness and value of online advertising as
a promotional medium. This because clickthrough rates 1 (ranging typically between 3 and
5.3.3. Third parties
Next to the synergies described above, success in
the virtual marketplace often requires co-operation
with Internet partners outside the organisation and its
value system. This networking aim at strengthening
the competitive position of virtual organisations and
the network must be seen as complementary to the
traditional promotional activities. Candidate partners
for such online synergies are:
• Search engines and Web directories. These
partnerships can increase the exposure of the
online organisation into the Web marketplace by
allowing online customers to locate and easily
access the site. Learning the way search engines
and Web directories operate and delineating
67
1
Click-through rate is the percentage of the visitors of a Web Page
clicking-through on an advertising banner or button.
68
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
5%) are perceived by many advertisers as low
but the question whether the click-through rate
is a sufficient basis for evaluating the effect of
online advertisement in its totality, has not been
fully answered yet.
The selection criteria of partners for online
advertising are obviously more stringent that the
criteria for appointing affiliate partners while
efforts to relate fees to actual and measurable
results will sooner or later become the subject
of a wider industry debate.
Next to the careful selection of partners other
success factors of online advertising are the
originality, capturing power and timing of the
advertising copy.
5.3.4. System
This factor identifies the technological issues as
well as the site servicing issues to be addressed by
the E-Commerce management. In the early days of
the commercial Web, technology was widely considered as the main driving force behind the Internet
growth. This fact often led to technology overkill,
undermining the strategic and commercial principles
that should underpin any online organisation. Technology overdoses can result in customer confusion,
dissatisfaction, diminishing Web experience and lost
business. Despite the fact that ICT remains the
functional backbone of the E-Commerce, the role of
technology must be put into perspective and technology should never become the starting point of online
activities.
The main areas where the System-related decisions are to be made are:
• Web site administration, maintenance and service. Availability of technical and service personnel on a 24-h, 7-days a week basis is the
basic requirement for a reliable site.
• Web server hosting and choice of the Internet
Service Provider. External hosting is a popular
option mainly for small and medium-size organisations.
• Site construction. Constructing an above the
average, transactional E-Commerce site requires
a substantial initial investment. Outsourcing this
activity is usual, there are however many edit-
•
•
•
•
•
ing tools available for low-budget solutions.
Presentation quality, user friendliness, easy
navigation, browser independence and speed are
important success factors determining the
choice of programming and development tools.
Content management. Important elements of
content management are the frequent reviewing
and updating of the content in response to
constantly changing customer needs, market
conditions, competitive strategies and market
trends as well as the decentralisation of the Web
site updating procedures. The later requires
training and empowerment of employees of
different departments in managing the site data
under their responsibility and is needed for
avoiding bureaucratic procedures harmful for
the content quality.
Site security. Protection against any forms of
malicious attacks as well as transaction and
customer data safety are paramount concerns of
E-Commerce managers and online customers
alike. Identifying the proper security level for
each content category is a sensitive issue since
increasing security levels usually result in reduced functionality or diminishing user friendliness. A good approach is customising security
levels on the different site elements therefore
avoiding unnecessary safety overdoses while the
sensitive data is adequately protected with
minimum functionality sacrifice.
Transaction functionality. The main elements
here are the construction of communication
interfaces, the choice of the transaction and
payment technology, the testing and administration of the system.
Collection, processing and dissemination of the
Web site traffic and transaction data. These
type of data fulfill, next to their administrative
significance, an important commercial role as
the vital input for evaluating the site performance, testing new ideas or assessing the effect of
promotional activities.
System backup. A sound back-up mechanism is
vital for Internet organisations expected to be
operational on an around-the-clock availability
basis. Technical problems and system failures
must be quickly addressed with the minimum
operational disruption.
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
Finally the site technical management must regularly and in collaboration with the commercial
management identify and evaluate new technologies
and new available products that could upgrade the
site performance, enhance the customer experience
and effectuate operational economies.
6. Implementing the Web-Marketing Mix: two
exploratory cases
6.1. The background of the case studies
During the second half of 1998 making use of a
sabbatical leave I accepted the invitation of a consulting firm in Athens, Greece, to work as E-Commerce consultant for a period of 6 months. This
appointment was an excellent opportunity to test in
the field the applicability and practical value of the
4S model as the basis of E-Commerce strategic
planning. The two cases presented are summarizing
the main issues resolved during the planning process
of the E-Commerce activities, based on the WebMarketing Mix model. The planning process produced a strategic and operational blueprint that
became the basis of the whole E-Commerce project.
The case studies explain how the 4S framework
has been applied in the field and outline the main
empirical conclusions drawn from these particular
projects. The purpose of the case studies is assist the
reader to understand how the methodology works
rather than evaluate the actual commercial or other
results of the online activities in question.
6.2. Case 1: the ABC Portfolio* case
6.2.1. The Web presence of ABC Portfolio*
ABC Portfolio* is a Portfolio Management firm
based in Athens, Greece. The firm was at that time a
new player in the Greek financial market and commenced operations in 1998. The company management decided to introduce a corporate web site that
would be launched simultaneously with the first of
the company’s products, the ABC Mutual Fund*.
The 4S Web-Marketing Mix framework was used
as the platform for drafting the Strategic and Marketing plan for the company online activities. This plan
would provide the framework for developing and
69
commercialising the corporate Web site and integrating the online with the traditional company
operations.
Prior to the introduction of the first of ABC
Mutual Fund* products, the company launched a
mass media advertising campaign. The objective of
the campaign was to create brand and product
awareness and to position the ABC Mutual Fund* as
a new investment fund managed by a highly skillful
and dynamic management team. Next to the management qualities other key words of this campaign
were the terms Teamwork, Information, Openness
and Reliability.
The basic problems to be addressed in designing
and commercialising the corporate site were:
• how the Web presence can add value to the
company and what role the site should play as a
company strategic element;
• how the Web site could attract and retain
visitors;
• how the Web operations would be evaluated.
Having defined these problem areas a detailed
strategic and marketing plan was drafted based on
the 4S framework. Due to the limited time available,
most of the required market and customer information was obtained by means of desk research and
expert interviews.
The main elements of the plan based on the 4Ss
were:
6.2.1.1. Scope (strategy)
Potential site visitors would be portfolio managers,
shareholders, private investors and the press. The
target market was primarily the Greek market but
also English-speaking individuals. Considering the
number and profiles of Internet users at that time in
Greece the objective as to the average number of
potential visitors of the site was estimated to be
between 1000 and 5000 daily.
One of the main difficulties at the time was the
limited Internet experience among the majority of the
potential users at that time. Most potential users
preferred the traditional sources of information and
traditional ways of contact with investment funds.
Turning to the Internet could be a difficult step if that
involved complicated and time-consuming processes.
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E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
The main motive for visiting the site was thought
to be finding reliable and up to date market information and access to market analyses that would
reduce investment risks taken by visitors: portfolio
managers, investors and stockholders. Other type of
information interesting to the potential visitor would
be company news, and the actual price of the fund’s
stock closing price. Next to that site visitors should
be able to find a daily update on the fund’s net asset
value and portfolio composition. The last two elements were a major innovation for the Greek market,
considering that investment funds are obliged by law
to publish this data on quarterly basis.
Major factors influencing the site visitor to use it
and return to the site would be the high quality of the
information found in the site as well as the speed,
easy navigation and user friendliness.
The main strategic objectives of the ABC Web site
were formulated as follows:
• The site content would be continuously updated.
• The site would be bilingual (Greek and English).
• In order to increase the customer retention the
site would offer to frequent users the option of
getting access to a second layer of specialised
and high-quality information provided by the
analysts of the company by becoming members
of the ABC Club*. Membership to the club
would provide users with a number of attractive
privileges. Next to the retention element of this
strategy, direct promotional activities regarding
future products would be possible using the club
database.
• A second instrument of customer retention
would be an educational section providing a
frequently updated educational content partly
based on actual customer questions and interests.
(a) To become the prime source of market information about the Athens Stock Exchange.
(b) To become a source of company value as a
promotional and relational site. This should be
achieved by assisting the overall marketing
effort in communicating the company brand and
products as well as attracting and retaining a
number of site users that would become, on basis
of their own consensus, the prime prospects for
future company products.
6.2.1.3. Synergy (organisational aspects)
(a) Front Office. The Web site became a clearly
visible part of the promotional and PR campaign
prior to the launching of the fund and one of the
basic elements of the official presentation to the
public. The site address was also visible to all
documents and communication material of the company. An extended direct mail campaign would
support the site introduction.
( b) Back Office. A team of analysts would be
responsible for the updating the site content, daily
market comments and analyses while a marketing
team would handle the contacts with the users, and
would be responsible for the management of the
ABC Club database and the online commercial
activities.
(c) Third parties. An extensive effort was made
for registering the site URL with the major search
engines, meta-search engines and Web directories.
Also advertising banners were placed in a number of
high traffic web sites.
6.2.1.2. Site (operational aspects /web experience)
Based on the above strategic analysis it was
decided that the site experience should be based on
the following elements:
• Information would be the ‘strategic product’
offered by the site. The Unique Selling Proposition of the site became the Power of Information, a position that would appeal to the
target group. Openness, honesty and respect for
the customer were also basic elements of the
site positioning.
• The site design should allow ease of use and
very speedy downloading (less than 20 s) of the
home page and the other web pages. All information should be accessible with a maximum
of three mouse clicks.
6.2.1.4. System (technical and technological aspects)
Important element of the site design was the
browser independency and simplicity. It was decided
that for reasons of efficiency the company should
host the site itself. Important aspects to be addressed
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
were the content management, the continuous technical improvement and the management of the incoming user information and inquiries. The security
requirements were moderate at the initial stage with
the only protected area being the ABC Club*
section. Also special attention was placed in monitoring of the site performance.
6.3. Creative process and evaluation
Based on these guidelines a detailed site map was
drafted indicating the main elements as well as the
details of the site content. In the initial form the site
was extremely simple to use as well as fast, something that was obviously very much appreciated by
the user. The first major renovation of the site was
done after a year.
The combination of advertisement and PR as the
main promotional instruments in combination with
an original positioning proved to be fairly successful
and the site received a lot of free publicity prior to
the launching. The most important elements of the
evaluations that took place after the site launching
and later on were:
• The 4S framework covers all major strategic
and operational areas of the Web operation of
ABC Portfolio*.
• The Strategic and Marketing plan based on the
4S framework allowed the site designers to
concentrate on the technical aspects of building
the site, saving them from a lot of time in
planning and research work. The construction
time was very short.
• The synergetic effect of the promotional campaigns and the PR activities attracted within 3
weeks an average of around the 16 000 hits per
day. This number was at that time the highest
for a Greek commercial site (excluding the sites
of Internet Service Providers).
• The ABC Club* became highly popular in a
short time; the number of the registered users
after a year reached the 35 000 persons.
• The number of the daily hits after a year was
close to the number of the registered ABC
Club* users, indicating a high degree of customer retention.
• The group of users registered in the ABC Club*
71
became a very valuable target group for future
ABC Portfolio*.
*ABC Portfolio, ABC Mutual Fund and ABC
Club are aliases.
6.4. Case 2: the Fidelity Insurances** case
The Fidelity Insurances** is a mid-sized Greek
insurance organization with a good market position
and reputation. The time the Fidelity Insurances**
decided to enter the E-Commerce arena coincided
with some difficulties the company experienced in
marketing a line of innovative products (special
types of insurances, services and credit cards, etc.),
some of them unique to the Greek market. The
existing distribution channel (agents) was showing
low interest for these new products, that like most
innovations in the services sector, required a lot of
push effort and personal selling.
The Web project was the first serious Internet
operation of the company. The whole project was
based on a strategic and operational blueprint drafted
according to the 4S Web-Marketing Mix methodology and took place in the end of 1998. The 4Ss in
detail:
6.4.1. Scope (strategy)
(a) The prime strategic goal was to increase the
market awareness and if possible the sales of the
before-mentioned new services by communicating
directly with the market, outside the traditional
distribution channels. Furthermore it was important
for Fidelity Insurances ** to take a lead in the
E-Commerce for assurance products in Greece. This,
next to the obvious positive effect on the bottom
line, would also enhance the company’s image as a
modern, reliable, innovative, customer friendly and
efficient organization.
Improving the customer retention through better
communication, customer management and customer
service as well as being prepared for global competition were also strategic objectives of the E-Commerce project, in line with the long-term organizational vision.
Another important strategic goal was the creation
of a customer and prospects database based on
customer data collected online. The database would
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E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
provide the agent network with sales leads, this way
reducing the chances of channel conflict and ensuring the support of the network to the online project.
This database would be used also for direct marketing and other types of traditional promotional activities.
(b) The competitive analysis indicated that all
major insurance players in Greece had already an
online presence. A closer look however revealed that
the Web sites of the vast majority of competitors
were much less professional than one would expect.
A common element of almost all sites was a
brochure-like presentation with massive texts, very
slow downloading times, limited interaction and no
online transaction possibilities. The effort of most
companies was obviously to impress the online
visitors by presenting them with a bulk of information about the organisation, its services and
financial achievements, in fact doing nothing more
than providing the type of information that most web
users would find annoying or irrelevant. The product
information was often based on long texts, sometimes containing even the contract fine print.
(c) Research on the Internet users’ demographics
was combined with the company information as to
customer profiles in order to identify market segments and potential target groups. The study identified a number of prospective target groups for the
online products among Fidelity’s customer population and non-customer segments. The market potential was estimated to be the 4% of the Greek
households at that time.
(d) The strategic function of the Web presence was
defined by a combination of Transactional, Promotional and Informational roles, with the management
placing more emphasis on the first one of them. The
study revealed though, that the expectations as to
online sales should be very limited, given the stage
of development of E-Commerce at that time in
Greece. This warning was indeed confirmed by the
subsequent experience.
The strategy as described above would be reviewed in regular intervals considering the fast
changing market conditions and technological developments.
6.4.2. Site (operational aspects /web experience)
Based on the above strategic issues the operational
elements of the study were focused on identifying a
number of elements likely to play a major role in the
site design. These elements were:
• the online customer profiles and their needs;
• the customer’s motives to search for and purchase insurance products;
• the way potential site visitors are likely to
search the Internet for the site products and
browse the information in it;
• the physical versus the virtual interaction process and the emotional issues likely to affect the
customer experience.
Based on these aspects the following suggestions
were drafted:
(a) ‘Security’, ‘Advice’ and ‘Reliability’ were the
generic concepts that would communicate the
site’s emotional positioning. These attributes
were also in line with the ‘physical’ company
image.
(b) The Web presentation would be differentiated
from the competition by means of user friendliness, focus on the site visitor’s needs, value, and
efficient service.
(c) Important elements of the Web Experience were
the content, the interactivity and the service
offered online. Information about the company,
its network and financials was also available but
only as a background options.
(d) Since assurance products are typically requiring
personal selling one of the site objectives was to
simulate as much as possible the conditions of
the physical interaction between the sales rep
and the customer and to guide the online customer through an interactive process that would
lead to the successful conclusion of an online
sale.
(e) Considering the technical limitations of that
time, it was evident that multimedia was a future
option and in the initial stage the online presentation was to be based on more conventional
web tools. Important elements of the presentation were:
– Ease of navigation. Necessary condition was
that all available information could be accessible to the site visitor with a maximum of
three mouse clicks. A simple and very easy to
use start menu would save time eliminating
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
unnecessary searching while the maximum
page download time should not exceed the 20
s for an average user.
– Easy access to information about the products
and services. The product information was to
be presented in three layers starting from a
short description of the product, followed by
a summary of the main product attributes and
in the third layer offering an extended product
description for potential customers interested
in details. Potential visitors could identify this
way very early in the search process whether
a specific product or service was interesting
and minimize this way the searching time.
– In all information layers the customer had
access to a calculation tool and an order /
information request form. The customer was
also presented the option to be contacted by a
sales rep and ask for online assistance in
filling in the order form.
– Easy ordering procedures and special incentives (discount) for new customers ordering
products online were aiming at lowering the
threshold of engaging in online transactions.
(f) An important issue was the selection of a
domain name. Since the original Greek brand
name translated in English was yielding a difficult to remember and write word, a new
domain name was found.
73
and resources had to be reviewed in order to spot
the possible areas of conflict and the weak points
of the existing organisation (partly) migrating to
an online-based environment. The review identified the main organizational issues to be addressed and produced a number of suggestions
facilitating the smooth integration of the web
activity into the existing business. Important
topics addressed were the communication process, the integration of E-Commerce within the
infrastructure legacy, the site administration,
order fulfilment and the content management.
Other essential issues were the problems of the
online customer service and the efficient as well
as fast handling of transactions, customer problems and e-mails. Such issues indicated the need
for forming a separate E-Commerce organizational unit. Finally special attention was placed
on the management of the databank and the site
traffic data.
(c) Third parties. The site was registered with all
major web directories and search engines while
special attention was placed on increasing the
findability of the site by the, in that time,
growing number of meta-search engines. During
the introduction stage some online advertisement
activities aiming at the greater possible exposure
of the brand would also take place.
6.5. System (technical and technological aspects)
6.4.3. Synergy (organizational aspects)
(a) Front Office integration. A detailed introduction
plan was drafted combining traditional media
(Direct Mail, advertisement, PR) and electronic
media (online advertisement, multimedia presentation) for supporting the site during the
commercialisation and the initial stage of its
online presence. The campaign was to be fully
compatible with the existing and future marketing activities. The message of the campaign
should be focused on value and advantages of
doing business online that would be attractive
for the target groups. The online activity should
be also integrated as much as possible to every
future traditional promotional action in order to
increase the market awareness as to company’s
online presence.
(b) Back office integration. The internal processes
The main technological parameters of the project
were not much different than the previous case, with
a few new dimensions, namely the settlement of the
online transactions and the increased security requirements.
Other important issues were the hosting of the
system, that the company kept in-house rather than
outsourcing it, the technical support of the E-Commerce applications and the criteria for selecting the
designer and constructor of the site.
6.6. Evaluation of the Fidelity Insurance** project
Fidelity Insurances** became the first Greek and
one of the pioneering sites in Europe to offer
insurance services for sale on the Internet. Like the
previous case, one of the main advantages of the 4S
methodology was the important time saving in site-
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
74
building time and the realization of an innovative
and clearly positioned online presentation. The site
attracted a lot of attention in Greece and became an
example for other insurance sites.
Although no financial or traffic data have been
released the management considered that the site had
achieved most of its strategic objectives, becoming a
valuable marketing tool and maintaining its original,
initial form for almost 3 years. The long life cycle of
the site could be attributed to the fact that the
comprehensive strategic and operational analysis as
the foundation of designing the Fidelity Insurance**
site, gave to the site a long-term competitive advantage, saving substantial amounts by preventing frequent changes and experimentation.
**Fidelity Insurance is an alias
7. Summary
The paper reviews the criticism on the role of the
Marketing Mix 4Ps model as the paradigm of the
traditional marketing and evaluates its role in ECommerce defined markets. The frequent criticism
of the 4P Marketing Mix model as the backbone of
the traditional, physical marketing management is
also applicable to online marketing management,
while two more factors further undermine the effectiveness of the model as the marketing management
platform in virtual environments:
• The very role of the 4Ps in an online environment is quite different than their role in a
physical market setting. The 4Ps are not the
critical factors of the virtual marketing process
but rather elements of the total Web Experience.
In this respect the effect of these factors on the
consumer’s decision making process is much
more limited in the virtual environment than in
the physical one.
• The 4Ps are operational parameters. Management of E-Commerce activities based only on
the 4P framework ignores the dynamic strategic
elements of the online marketing process that
are extremely important for survival in the
volatile and fast-changing virtual markets.
As an alternative option the paper proposes the 4S
Web-Marketing Mix framework that allows the web
marketer to solve the strategic and operational issues
of the Internet marketing in an integral and efficient
way. The proposed framework emphasises the need
for a new approach towards the online marketing, by
fully integrating the virtual activities within the
existing company strategy, marketing and operations.
The practical objective of the paper is to help
established or future E-Businesses to utilise the
Internet technology and the online market potential
in an efficient way, adding value to the overall
company operations. The methodology proposed is,
however, the subject of further research and empirical testing.
The review of two field projects outlines some
interesting aspects. The companies in question have
experienced both projects as successful and both
projects have been also seen as very innovative in
the Greek Internet Market. Yet the purpose of
presenting these cases is not to evaluate their commercial merits (measuring the ROI of online activities is a notoriously complicated issue) but rather
to explain how the Web-Marketing Mix methodology
can be applied in practice.
Summarizing the cases we can identify the following main conclusions:
• The 4S framework defines the main elements of
an E-Commerce project in a simple and practical way. It offers a platform for drafting a
comprehensive Strategic and Marketing plan for
the fast changing Web environment.
• E-Commerce plans drafted on the basis of the
4S methodology save considerable time in
designing and completing the online project.
Presenting web designers with a strategic and
operational blueprint allows them to focus on
the implementation aspects of the project
• A deep and extensive situation analysis and the
consequent identification of the 4S factors is
likely to yield a Web site that can maintain for
longer time its proprietary competitive advantages, reducing the cost of upgrades and updates.
• Planning and implementing an E-Commerce
B2C project involves a considerable amount of
classic marketing effort. The Scope, Site and to
a lesser extend the Synergy elements of the mix
E. Constantinides / Electronic Commerce Research and Applications 1 (2002) 57 – 76
require clear strategic vision and market orientation.
• The Web site’s competitive advantage must be
based on its market orientation and the customer’s Web Experience rather than technology.
E-Commerce must therefore be considered and
approached primarily as a marketing management problem rather than a technological issue.
Acknowledgements
The earlier version of this paper was presented at
the HICSS-35 Conference, Big Island, Hawaii, on
January 2002.
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(2000).
L. Bielski, E-Business models stress putting the customer first,
ABA Banking Journal, July 2000.
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Real-World Introduction to Electronic Commerce—An Online
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A. Ranchhod, F. Zhou, J. Tomson, Factors Influencing Marketing
Effectiveness on the Web, Information Resources Management
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T. Robinson, Modelling for Success: Why Strategy Comes First,
Arthur Andersen Consulting, 2000.
L. Tompson, E-Commerce: Changing the rules of strategy implementation. Strategy and Leadership (2000) 35–39.